Fabricas El Carmen, SA, De CV v. US

• Decision Date: 17 February 1988
• Docket Number: Court No. 85-04-00558.
• Citation: 680 F. Supp. 1577,12 CIT 129
• Parties: FABRICAS EL CARMEN, S.A., de C.V., et al., Plaintiffs, v. The UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

680 F. Supp. 1577

12 CIT 129

FABRICAS EL CARMEN, S.A., de C.V., et al., Plaintiffs, v. The UNITED STATES, Defendant.

Court No. 85-04-00558.

United States Court of International Trade.

February 17, 1988.

Green & Hillman, Richard G. Green and Ben L. Irvin, Washington, D.C., for all plaintiffs other than Derivados Acrilicos.

Richard K. Willard, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Washington, D.C., Jeanne E. Davidson, Civil Div., U.S. Dept. of Justice, for defendant.

OPINION AND ORDER

RESTANI, Judge:

Defendant moves to vacate the portion of this court's previous decision requiring remand. Fabricas El Carmen, S.A., et al. v. United States, 12 CIT ___, 672 F.Supp. 1465 (1987). Defendant further moves to dismiss this action challenging the final affirmative countervailing duty determination of the United States Department of Commerce, International Trade Administration (ITA). Certain Textile Mill Products from Mexico, 50 Fed.Reg. 10,824 (Mar. 18, 1985). Defendant argues that the results of the first administrative review of this determination, Certain Textile Mill Products from Mexico, 52 Fed.Reg. 45,010 (Nov. 24, 1987), have rendered the remand moot.

FACTS

On October 7, 1987, this court denied certain challenges to ITA's final determination that a certain program bestowed countervailable benefits. 672 F.Supp. 1465. One of the arguments rejected by the court was plaintiffs' contention that losses due to Mexico's exchange rate system either negated any possible basis for finding that the program bestowed a subsidy, or resulted in net subsidy of zero. The remaining issues involved the methods ITA used to arrive at specific amounts of net subsidies, but it does not appear that other methods would have entirely eliminated any finding of net subsidy. Plaintiffs do not now argue that this is a possibility under the court's opinion. With regard to three of plaintiffs' methodology challenges, the court found ITA's determination neither based on substantial evidence nor in accordance with law. Accordingly, the case was remanded to ITA for correction of errors. ITA was ordered to report its results in 45 days.

On November 20, 1987, prior to the time allowed for reporting the remand results, ITA filed the instant motion.

ARGUMENTS

Defendant argues that this court's remand order should be vacated, and this action dismissed, on the ground that "intervening circumstances ITA's first administrative review of its final affirmative countervailing determination and order have rendered the remand moot ... and that unless vacated, the remand order would require this Court to issue an advisory opinion contrary to Article III of the Constitution." Defendant's Motion for Vacatur of Remand Order and to Dismiss at 1. Defendant explains that

even if the amount of the subsidy in this case were revised upon remand, such a finding would have no practical effect because the adjusted subsidy could not be used for duty assessment or as the deposit rate on future entries. Thus, no entries—present or prospective—can be affected by any change that may result from recalculation of the original duty deposit rate upon remand.

Id. at 2-3. Defendant relies for support of its position, in part, upon the court's opinions in PPG Industries, Inc. v. United States, 11 CIT ___, 660 F.Supp. 965 (1987), Alhambra Foundry v. United States, 10 CIT ___, 635 F.Supp. 1475 (1986) and Silver Reed America, Inc. v. United States, 9 CIT 221, Slip Op. 85-51 (May 1, 1985).

Plaintiffs do not dispute the correctness of the court's prior opinions, but submit that this case is distinguishable in that in the final results of the administrative review ITA has ignored completely the court's instructions in remanding the underlying matter. In addition, plaintiffs argue that

Since administrative reviews are almost routinely requested, if ITA's position is accepted by the Court, ITA is in a position to negate any order of this court for a remand simply by waiting until the last minute and then coming down with its final administrative review determination which blithely repeats all the errors the Court has instructed it to correct. ITA high-handedly tells the Court (page 6 of its memorandum) that plaintiffs may start all over again with a suit seeking judicial review of the final results of its administrative review. As if the Court calendars are not already sufficiently overloaded, ITA would require aggrieved parties to go through a chain of lawsuits to get a determination of an issue—and perhaps never get a determination because ITA evades the Court's direction by attempting to nullify it through publication of an administrative review—in this case, publication with an effective date after the due date of its response to the Court's remand.

Plaintiffs' Memorandum in Opposition at 3.

DISCUSSION

The court has found, on previous occasions, that the publication of the results of a 751¹ administrative review may in some cases warrant vacatur of this court's pending order of remand to ITA regarding the underlying final determination. Alhambra Foundry v. United States, 10 CIT ___, 635 F.Supp. 1475 (1986) (vacating a remand order in a review of a countervailing duty determination and Silver Reed America, Inc. v. United States, 9 CIT 221, Slip Op. 85-51 (May 1, 1985) (vacating a remand order in a review of an antidumping duty determination). See PPG Industries, Inc. v. United States, 11 CIT ___, 660 F.Supp. 965 (1987) (actions challenging countervailing duty investigation and determinations dismissed as moot). In Alhambra, the court previously had remanded a countervailing duty determination to ITA for further clarification and determination regarding certain issues bearing upon the calculation of certain benefits, but not for redetermination of whether such benefits constitute countervailable subsidies. The court relied upon Silver Reed in support of its holding that a remand would serve no purpose, because the results of the intervening 751 administrative review would serve as the basis for the actual assessment of duties on past entries covered by the review, and for cash deposits on future entries.

Although there are some factual distinctions to be drawn among the cases, the essential reasoning underlying the Alhambra, Silver Reed and PPG Industries decisions is applicable here. Central to this reasoning is an understanding of the limited scope of ITA's investigation phase, which may culminate in a final determination and order, and of this court's jurisdiction over the various separate determinations which take place over the life of a proceeding. See 19 C.F.R. §§ 353.11 & 355.6 (1987) (definitions of "investigation," "determination" and "proceeding") and 19 U.S.C. § 1516a(a)(2) (1982 & Supp. III 1985) (review of determinations on record).

Countervailing duty determinations and orders, which are part of the investigative phase of a countervailing duty proceeding, 19 C.F.R. § 355.6(b), provide for provisional measures such as the suspension of liquidation of merchandise entered after a preliminary determination and for the setting of rates for cash deposits of estimated duties in accordance with calculations of net subsidies set forth in ITA's preliminary and final determinations.² The actual assessment of countervailing duties, however, does not occur until after ITA's countervailing duty order has been published. Assessments are then made on past entries on an annual basis, either as part of a 751 administrative review or, under current law, if a review is not specifically requested, at the instruction of ITA pursuant to its regulations providing for assessment at the cash deposit rate in effect at the time of entry. 19 U.S.C. § 1675(a) (1982 & Supp. III 1985), 19 C.F.R. 355.10(d) (1987). British Steel Corp. v. United States, 11 CIT ___, 647 F.Supp. 928, 930-31 (1986) appeal dismissed as moot and remanded for vacatur No. 87-1050 (Fed.Cir. April 1, 1987) vacated in part 661 F.Supp. 68 (CIT 1987) (vacating denial of preliminary injunction). See British Steel, 11 CIT ___, 649 F.Supp. 78, 80-81 (1986).

A remand of an original countervailing duty determination which results in ITA's recalculation of the amount of net subsidies compels ITA to set new cash deposit rates for new entries, and if no review is ultimately requested for the period covering those entries, in ITA's assessment of duties on those entries at that same rate. 19 U.S.C. § 1675(a), 19 C.F.R. § 355.10(d), British Steel, 647 F.Supp. at 930-31. Once the final results of the 751 review are published, however, any recalculation of deposit rates by ITA in a remand of the original determination has no effect on new entries because applicable deposit rates are set by the 751 review. 19 U.S.C. § 1675(a)(1), 19 C.F.R. § 355.10(c)(8)-(9). See PPG Industries, 660 F.Supp. at 970, Alhambra, 635 F.Supp. at 1476, Silver Reed, 9 CIT at 224. The past entries covered by the 751 review period are no longer the subject of any deposit rates, but rather, are the subject of a completed final assessment determination made in that 751 review. Id. Thus, the remand does not affect them.³ The remaining past entries, occurring after the 751 review period—December 31, 1985—but before the review's publication date—November 24, 1987—will be assessed in accordance with subsequent reviews, if requested, or at the cash deposit rate at the time of entry. 19 U.S.C. § 1675(a), 19 C.F.R. 355.10(d), British Steel, 647 F.Supp. at 930-31...